REPOSTED DIRECTLY FROM INMAN NEWS. THIS CONTENT HAS NOT BEEN MODERATED BY WFG NATIONAL TITLE.
Electric vehicles and car-sharing are distinct trends that are colliding as policy makers and drivers pay more attention to reducing greenhouse gas emissions and easing traffic congestion. Now two real estate professionals have picked out the best features of both trends to build a community-based business model for their startup.
The startup is Culver City-based Envoy Technologies and the business model makes all-electric car-sharing an amenity for high-end hotels, apartment complexes and workplaces, just like a rooftop pool, concierge service or a tricked out gym. Think Tesla and you’re on the right track.
Aside from Tesla, Envoy’s all-electric fleet includes VW, Fiat, Nissan, Chevrolet and GenZe, the e-bike and e-scooter company.
Envoy applies the same model to mid-range properties and disadvantaged communities, where individual car ownership is financially or logistically difficult, if not practically impossible. Envoy anticipates that the negligible cost of EV charging compared to today’s high gas prices will help motivate participation in communities that have been late to adopt car-sharing.
The company launched in April 2017 and so far its model of “electric mobility as an amenity” has caught on quickly. Today Envoy announced that it has joined with seven new real estate and technology partners involving confirmed orders for hundreds of vehicles. Along with the vehicles comes a robust network of charging stations numbering in the thousands, through a partnership with the startup Electrify America.
That’s quite a leap for Envoy, which started with two vehicles last year and stepped up to 30 in its first 14 months of existence.
Envoy vehicles are currently stationed at Equity Residential’s Marina 41, Related Real Estate’s Argyle House, Hackman Capital’s Culver Studios and the SIXTY Beverly Hills Hotel.
Another 16 electric vehicles are slated for Maximus Real Estate’s Parkmerced development in San Francisco later this year, and Tesla vehicles are set for delivery to Argyle House, SIXTY Beverly Hills Hotel and 33 Tehama. The company expects to announce additional properties in Los Angeles and the Bay Area soon.
In addition, earlier this year Envoy received a $1.5 million grant from the California Energy Commission to help bring EV car sharing to disadvantaged communities in Sacramento and the Bay Area, as part of a broader public initiative to ramp up zero-emission vehicles in California.
The basic concept of mobility-as-an-amenity is simple. As the fleet owner, Envoy provides a turnkey service that includes maintenance and insurance. Property owners pay a base fee to have the service on their site. Drivers pay for their usage as with any other car-sharing service, and revenue-sharing offsets the base fee.
Car-sharing is already a familiar and growing feature in urban markets like New York City. The difference is that Envoy is hyper-located. It connects people who live or work in one place together with the EV sharing experience, helping to accelerate familiarity and word-of-mouth adoption.
That’s not an accident. In a conversation with Inman, co-founders Aric Ohana and Orie Sagie emphasized that the concept for Envoy grew organically from their experiences managing and investing in real estate, which included several years of carpooling with each other.
“We have been in commercial real estate investment together, and we started investing in housing,” Ohana said. “We were looking for new amenities to enrich the property, and we thought shared mobility would fill a need.”
“We looked at other groups in the shared mobility space and noticed they were not community based,” Ohana added. “We thought communities would work well with car sharing. It could even be a single family or whole neighborhood, where you are sharing vehicles with people you know, and who have shared experiences.
The numbers are backing that up. To cite one example, when Envoy service started in a mid-range residential building with more than 100 units, 15-20% of the occupants used the service right away. After that, the usage grew steadily week-over-week.
In another example, revenue-sharing in a newly built luxury residential property has already offset the Envoy base fee significantly, even though only 10 of the building’s 114 units are occupied so far.
Ohana anticipates that the personal touch will be even more important in disadvantaged communities that are not served by existing car-sharing companies.
According to some studies, app-based car-sharing breaks down as a class and race-based service. However, evidence is beginning to show that underserved communities do participate in car-sharing when the opportunity arises, depending on affordability. Having stakeholders and “ambassadors” in the community can help smooth the path and overcome other barriers to adoption.
Envoy also places a great emphasis on data collection, and that can lead to new opportunities. For example, a small but impactful percentage of carshare users sell their cars or delay buying a car. Sagie, whose background includes parking management, noted that the inclusion of on site carsharing can help developers allocate fewer parking spaces for new construction.
“The important thing to understand is that Aric and I saw a need. We were in the industry and recognized the opportunity. Everything came through life and work experience,” said Sagie.
The views and opinions of authors expressed in this publication do not necessarily state or reflect those of WFG National Title, its affiliated companies, or their respective management or personnel.